Backing Business to Create Economic Growth
Lucy Rigby Excerpts(3 weeks, 2 days ago)
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Sir Desmond Swayne
Irrespective of who was responsible, the question is: what is happening now? The reality is that we are facing a danger, notwithstanding the investment of time we are putting into scrutinising the Government’s programme, that it will not remain the Government’s programme for very much longer, such are the very different priorities of those who are lining up to take the Prime Minister’s job.
When the Prime Minister warned his party last week that unleashing a leadership election would bring about chaos, he was quite right, but that chaos also comes with a cost. Such is their horror at the prospect of those lining up to take the Prime Minister’s job, the markets that fund our gargantuan and growing appetite for borrowing are charging a risk premium higher than was charged for the Truss regime, and higher than is charged for Greece when it seeks to borrow. I am not a particular fan of the current Prime Minister, but I urge Labour Members—and, indeed, the voters of Makerfield, who will apparently have a rather more significant input in the settling of this matter—to take account of Hilaire Belloc’s cautionary verses, and, in particular, the tale of poor Jim, who ran away from nurse and was eaten by a lion:
“And always keep a-hold of Nurse
For fear of finding something worse.”
His Majesty told us that the legislative programme would include a Bill to strengthen our relationship with the European Union, but it is far from clear what that actually means. Do the Prime Minister’s red lines—no return to a customs union, or to free movement, or to the single market—still hold firm, and do they hold firm in the view of those who have expressed a much more enthusiastic agenda for returning to closeness with the European Union, among those candidates who are lining up behind him, seeking his job? Labour said in its manifesto that it was going to make Brexit work, but it has made it the excuse for the lacklustre performance of the British economy.
There is a measure of cakeism going on whereby Ministers, including the Secretary of State, tell us how wonderfully they have been doing. They have delivered the fastest economic growth in the G7, much faster than the countries that the Secretary of State identified in the European Union. They have delivered a reduction in inflation. They have delivered—
Sir Desmond Swayne
Quite right: interest rate reductions. They have done all these wonderful things, but at the same time they languish because we are not a member of the European Union. We have heard that criticism several times already today: we would be doing so much better if we were a member of the European Union. The reality is, however, that the European Union is not doing as well as Ministers are trumpeting that we are doing.
The Chief Secretary to the Treasury (Lucy Rigby)
It is a pleasure to close today’s King’s Speech debate on behalf of the Government. I am grateful to Members for their contributions, including the Business Secretary for his excellent opening speech and the shadow Business Minister, the hon. Member for West Worcestershire (Dame Harriett Baldwin), for her kind words—although I note that I did not qualify as a “beam of light”, nor others on the Government side. I speak on behalf of the whole House when I say that whichever part of that £5 million charitable donation the right hon. Member for Newark (Robert Jenrick)—he is not here, unfortunately —spent on his amateur dramatics course, he ought to ask for his money back.
Two years ago, the Chancellor stood at this Dispatch Box following the first King’s Speech of this Labour Government. She committed to rejecting the failed economic approach of the 14 years prior and to charting a different economic course, reinvigorating our economy after years of chronic under-investment, austerity and poor productivity, and the only Parliament in recorded history when living standards actually got worse. The Chancellor committed to charting a different course so that our economy delivers for people right across this country.
As a result of that approach, interest rates have been cut six times since the general election. In March, the spring forecast showed inflation coming down, as the right hon. Member for New Forest West (Sir Desmond Swayne) was good enough to highlight, and real wages continuing to rise. Last week, ONS data showed borrowing falling by around £20 billion compared with the year before. Importantly, economic growth accelerated sharply in the first quarter of this year, rising to 0.6%, despite the Iran war. Of course, today we have had the IMF upgrade to growth this year as well.
I am afraid I have to correct the shadow Chancellor, the right hon. Member for Central Devon (Sir Mel Stride), and the hon. Member for Rutland and Stamford (Alicia Kearns), because GDP per capita is up too. These things are the result of the fiscally responsible choices that this Government have made, and it is responsibility for a clear purpose. That same purpose will always be at the heart of who we are as a Labour party: improving the lives of working people right across the country.
We increased the national living wage and the national minimum wage. We have frozen prescription costs, and we have frozen rail fares for the first time in 30 years. We have scrapped the two-child benefit cap, lifting 450,000 children out of poverty. We are helping parents to save up to £8,000 a year with our expansion of Government-funded childcare, free breakfast clubs, and the new school uniform cap on branded items. Those things are helping millions of families across the country.
The conflict in the middle east is putting pressure on energy markets and creating renewed fragility in trade and supply chains. The Conservative party and Reform would have raced into that costly war—the Leader of the Opposition was clear about that at the time—with damaging consequences for both our national security and our economy. [Interruption.] Conservative Members are shaking their heads and saying it is not true, but one of two things must be true: either the Leader of the Opposition said that she wanted to take us into the conflict and she meant it, in which case she has catastrophically poor judgment, or she said that she wanted to take us into the conflict but did not mean it, in which case she is deeply confused and Conservative Members have more things to worry about than catastrophically poor judgment.
By contrast, the Prime Minister made the right decision to keep us out of that conflict. Because of his decision, and because of the action we have taken to stabilise the economy over the past two years, Britain today is in a stronger position to withstand the uncertainty and insecurity in the global economy.
As well as immediate support with the cost of living, we must also create the conditions for shared prosperity. That means more jobs, businesses expanding and investing, and people in every community and part of our country having greater security and more of their own money to spend. That is what a Labour growth agenda means. The Chancellor has been clear that she wants to ensure that that growth is stable and resilient. Why? Because that means people secure in their jobs and households secure in their finances and, in our increasingly uncertain world, it means that families the length and breadth of Britain will be more confident and hopeful about what the future holds.
All that is the basis on which the pro-growth legislation set out in the Gracious Speech is being delivered. That begins with legislation to reform and modernise regulation, to ensure that rules are proportionate to risk, and that businesses are able to expand and grow to the benefit of our economy as a whole.
I am grateful to the right hon. Member for Salisbury (John Glen) for his constructive comments about our enhancing financial services Bill. I confirm that the Bill will maintain the UK’s competitive edge by enabling the sector to support businesses of all sizes to invest and grow, including credit unions, with reforms to the common bond. We will ensure that regulation ensures more lending to small businesses, and we will give Government the power to take action on in-person banking services.
As many Members highlighted, the small business protections (late payments) Bill will tackle the scourge of late payments which, as my hon. Friend the Member for North West Leicestershire (Amanda Hack) wrote in her dissertation some years ago, cost the UK economy £11 billion each year and lead to the closure of 38 UK businesses every day.
We must also build resilience to protect our critical infrastructure. Steel is strategically important to our economy, which is why we acted last year to avoid a sudden halt to production at Scunthorpe, protecting workers and the community that depends on the site. It is why we are now bringing forward legislation to give us options to protect Britain’s steelmaking capability.
We have already announced major energy investments, including for the UK’s first ever small modular reactor in Anglesey and the next generation of nuclear submarines in Inverclyde. Our nuclear regulation Bill will modernise the way new nuclear projects are regulated so that we can deliver safe, secure and affordable nuclear power and infrastructure sooner, while maintaining strong environmental protections. Unlike a number of the Opposition parties, including the Greens and the SNP, this Government recognise the importance of new nuclear for our energy security, our climate security and our economic security.
My hon. Friend the Member for Bristol East (Kerry McCarthy) asked about the voluntary carbon consultation. The Government have published a summary of responses and a formal Government response will be published over the summer.
As Members have noted, we must improve connectivity and boost trade to unlock growth. Labour has been saying for years that far too many parts of Britain lack basic and reliable transport connections, and all the many positive economic benefits that flow from that. Some of these points were echoed by Members, including the hon. Member for North Shropshire (Helen Morgan). Northern Powerhouse Rail will help to build a northern economy that reaches its full potential. Backed by up to £45 billion of Government support, the new route will drive jobs and investment across a single, well-connected northern growth corridor. We are also taking steps to protect and grow the freight industry.
On the points raised by my hon. Friend the Member for Brent East (Dawn Butler) and by the hon. Member for St Albans (Daisy Cooper) about the overnight visitor levy, the levy is a key means by which we are delivering our manifesto commitment to devolve new revenue-raising powers. Revenues from the levy will support local economic growth and mayors will make decisions, informed by local consultation, about how revenues should best be invested in their region.
Britain will work closely with those who share our values and interests, which means a closer and more constructive relationship with Europe. That is why we are bringing forward the European partnership Bill.
Tom Tugendhat
I am delighted to hear that we will be working more closely with the European Union. As the hon. and learned Lady may know, my wife, being French, will be particularly pleased about that, but what will that mean for the agreement we have struck with the Pacific nations in the comprehensive and progressive agreement for trans-Pacific partnership, or the deal that we did with the Australians? Will the hon. and learned Lady be cancelling those deals as she focuses on the European Union, or will she be staying out of the customs union and the single market, and therefore being focused much more on being a rule taker? I am interested to hear her response.
Lucy Rigby
The right hon. Gentleman’s wife, and potentially he himself, will be pleased to know that those two things are entirely compatible. We will have to cancel absolutely nothing at all. The key point is that where it is in our national interest to align with EU regulation, the Bill will enable us to do so.
I want to address some specific points that were raised about Northern Ireland. The Government have worked closely with devolved Governments to design the Bill. The application of the agreements we are making alongside the Windsor framework will sweep away the majority of regulatory barriers for businesses moving agrifood goods.
Jim Allister
If the Minister is truly interested in sweeping away some of the barriers of the Irish sea border, in circumstances where sanitary and phytosanitary rules are being aligned, would the natural and proper constitutional move not be to take back control of the SPS system in Northern Ireland, instead of leaving it under the jurisdiction of the EU? If we are going to do a deal, let it be for the whole United Kingdom, so that the whole United Kingdom aligns, if that is what the Government think, instead of leaving Northern Ireland exclusively subject to the laws that the EU makes.
Lucy Rigby
As I said, the Government have worked closely with devolved Governments in the design of the Bill and we will continue to do that.
To conclude, the pro-growth legislation set out in the Gracious Speech will drive this country forwards. The Conservatives had 14 years to deliver their legacy, which left our economy weaker, left people poorer and, most of all, left our country smaller in stature. This Government are undoing that legacy and our pro-growth legislation will allow us to accelerate the change that the country deserves to see.
Our approach of a productive, active, agile state will ensure that we generate growth and lift living standards for people right across this country, not just for a few people and postcodes, but everywhere, because we value the contribution of the whole of Britain. The Bills in the King’s Speech are the path to a stronger and fairer future, and I commend the King’s Speech to the House.
Ordered, That the debate be now adjourned.—(Jake Richards.)
Debate to be resumed tomorrow.